It hit a 52-week high in early September but the Medibank share price has been struggling ever since.
The post Why is the Medibank (ASX:MPL) share price struggling lately? appeared first on The Motley Fool Australia. –
The Medibank Private Ltd (ASX: MPL) share price has been struggling lately.
Since reaching a 52-week high of $3.62 a share back on 7 September, the Medibank share price has fallen by more than 2% to sit at $3.55 a share so far today.
Even so, the company remains up by 16.6% year to date, and up a very healthy 38.3% over the past 12 months.
But why have Medibank shares been struggling over the past week or two?
Medibank share price struggles after ex-dividend date
Well, one anchor on the Medibank share price last week was its ex-dividend date.
That payment will hit investors’ pockets on 30 September. But it left the Medibank share price on 8 September when the shares went ex-dividend.
This is the primary reason why the Medibank share price has struggled ever since.
Even so, shareholders might not be too concerned. This final dividend was a boost from FY20’s final payout of 6.3 cents per share.
Another potential reason for Medibank’s recent struggle is some private health sector news.
According to a report on news.com.au this week, private health insurers like Medibank have been offering their customers ‘COVID discounts’.
The report states that “some of the largest insurers [are handing] back funds collected in premiums that didn’t get paid in claims due to Covid restrictions”.
This includes Medibank, which the report states has “also committed to returning around $105 million in Covid-19 net claims through premium relief for Australian Medibank and ahm customers with an active hospital and/or extras policy between the 2020/21 financial year”.
Whilst this news may please Medibank’s customers, it is still unquestionably deleterious to the company’s overall finances. This may have been deterring investors in recent times.
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Motley Fool contributor Sebastian Bowen has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.